NEW YORK – Big Law associates in 2023 enjoyed high salaries despite billing fewer hours than in previous years, according to a recent analysis. However, a closer examination reveals that the situation is not as rosy as it may seem on the surface.
While it is true that average hours billed by associates in 2023 decreased by nearly 8% compared to 2021, it is important to understand the reasons behind this decline. Associates in 2021 were already working unhealthy and unsustainable hours, with some even experiencing serious health issues. One associate reportedly suffered a heart attack and returned to work just four days later.
The decrease in billable hours does not necessarily indicate that associates were slacking off or refusing work. Rather, many associates were actively seeking more hours, as reported by numerous individuals in the industry. In fact, the rising salaries of associates have actually created additional pressure and discomfort among them, as they fear potential layoffs in the future.
The substantial raises that associates received were not the result of their own requests or involvement in the decision-making process. Instead, these salary hikes were set by firms that operate through a social norming phenomenon, where one firm sets a new standard and others follow suit. This situation adds immense stress to associates, particularly first-year lawyers who are billed out at exorbitant rates.
Contrary to the assumption that associates enjoyed leisure time due to reduced hours, the reality was far from relaxing. In a highly competitive industry, associates were faced with the constant fear of layoffs and were compelled to put in extra non-billable work to maintain a favorable standing within their firms. This was particularly true for junior associates from law schools impacted by the COVID-19 pandemic, who were eager to build their professional reputations.
Although the number of layoffs in 2023 may not have reached the levels seen during the 2008-2010 financial crisis, some firms have already undergone multiple rounds of quiet layoffs. Many of the associates affected were either those who failed the bar exam or were on immigration visas. Finding new job opportunities in this challenging market has proven to be extremely difficult for these individuals.
It is worth noting that while associates billed fewer hours, the top law firms still saw a 6% increase in revenues and a more than 5% increase in profits per equity partner. This indicates that the firms themselves are thriving despite the decrease in associate utilization.
In conclusion, the notion that 2023 was a smooth sailing period for associates due to their high pay and reduced workload is misleading. Partners who were approached for additional work and associates who did everything right in their careers, including graduating from top law schools and securing positions at prestigious firms, can attest to the challenges still faced in the industry. The overall situation for associates is more complex than what meets the eye, and further examination is needed to fully grasp the realities of their work-life balance and professional demands.